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much careful work during recent years. It is a necessity of the case that the measures which have been taken in each colony, as well for the organization of the local forces as for the construction of local defensive works, are, to a great extent, not yet fully understood and appreciated in other parts of the Empire. The close and thorough examination of the whole subject of Imperial defence which was completed by the Eoyal Commission presided over by the Earl of Carnarvon has led to the execution of extensive and important defensive works in various parts of the Empire; and the cordial co-operation offered to Her Majesty's Government by the colonies in carrying out this policy indicates their desire to arrive, so far as may at present be practicable, at a common basis of action. This work is still being actively pressed on, with the assistance of a Standing Committee, which is continuously occupied with matters relating to colonial defence. Much yet remains to be done; and it is of course unavoidable that secrecy should continue to be observed with regard to many of the defensive measures in progress or in contemplation. The time has, however, now arrived when an attempt may fairly be made to attain to a better understanding as to the system of defence which may be established throughout the Empire. For this purpose an interchange of knowledge as to the state of preparation or as to the capabilities of organization in each colony would lead to a more thorough understanding of their wants and wishes ; but, whilst Her Majesty's Government would thus be prepared to recommend for the consideration of the Conference certain principles calculated to promote the general defence of the Empire, it is not our intention, in calling the Conference, to commit either the Imperial Government or any colony to new projects entailing heavy expenditure, but rather to secure that the sums which may be devoted to this purpose may be utilised to the fullest extent, with complete knowledge of all the conditions of the problem. Second only in importance to this great question is one concerning in a special degree the interests of the Empire in time of peace. The promotion of commercial and social relations by the development of our postal and telegraphic communications could be considered with much advantage by the proposed Conference. It is a subject the conditions of which are constantly changing. New requirements come into existence and new projects are formulated every year. It is obviously desirable that the question of Imperial intercommunication should be considered as a whole, in order that the needs of every part of the Empire may, as far as practicable, be provided for, and that suggestions may be obtained from all quarters as to the best means of establishing a complete system of communications without that increased expenditure which necessarily results from isolated action. My own opinion is that the best time for meeting would be April or May. (c.) At the rate of 120 words per minute. Takes 10 minutes. Sir, this debate, which has now extended over six days, has convinced the Government—if it required to be convinced, or had entertained any doubts on the subject—that no more favourable or more practical financial proposals could have been submitted, with any prospect of being affirmed by this House, than the proposals made by the Colonial Treasurer. The speech of the honourable gentleman who has just sat down fairly states, I think, the difficulties with which this or any Government has to contend, when it has to consider what financial proposals it can submit with any prospect of success. We have, in the first place, to consider that we have to provide for heavy liabilities and engagements as to which we have no option, and which have not been of our own creating. Amongst those liabilities is an expensive portion of the service so frequently alluded to, and just recently referred to by the honourable member for the Waimea : I mean the postal service. We find that one-fourth, or thereabout, of the whole expenditure on the' postal service which we are compelled to ask the House to provide for, is a matter as to which neither the Government nor the House has positively any option. We find a standing contract for the Panama service, and an existing liability for the Suez service, for neither of which is this Government responsible, but which we are bound in law and honour to provide for. These two services, there is no doubt, are very heavy and expensive services for a community of the numerical amount of that of New Zealand to have to maintain. Previous Legislatures, previous Governments, have, however, thought it fit and proper and for the advantage of the colony that these services should be entered upon ; and, even if we wished to reverse that decision, we could not now do so without incurring a heavy claim for compensation. That is a matter which requires to be taken into consideration when the Government is called upon to decide what is to be the expenditure and the taxation of New Zealand. We have also to provide for upwards of three hundred thousand pounds under the head of permanent charges (being principally the interest and sinking fund on the debts of the colony), which is a first charge to be provided for by the country. This charge also existed when we took office, and we are not responsible for it. When these two very large items of expenditure are considered, it will be perceived how greatly the discretion as to what should be our annual expenditure is limited ; although I do not, nor did any member of the Government during the debate, nor did my honourable friend when submitting his proposals to the House, attempt to assume the position that there is no possible discretion left as to reducing the expense of some of the services on the estimates. There is no doubt that the House has a right to do so, and it may possibly be able to exercise that right with benefit to the country. I can say most heartily for the Government that, if the House can fairly and honestly point out and effect any reduction in the services, there is no member of the House that will be more thoroughly gratified than will the members of the Government. How could it be otherwise ? Whatever this Government may be supposed to be deficient in, I believe the House will at least give it credit for possessing sufficient sagacity to discern that nothing could make it more popular than to effect reductions —that nothing could make it more acceptable to the country than that the Government should come down to this House with a proposal to reduce taxation. We have not to wait for honourable gentlemen to rise in their places and tell us this. Those of us who have taken a part in the administration of public affairs have known it for years, and if we had not known it before we could not now be in office for a week without having it forced upon our notice. If we wished, in administering the affairs of the colony, merely to consult the popularity of the Govern-